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Big Board May Delist Key3 Shares

Securities: The NYSE's warning was expected after the trade show producer's stock fell below $1 last month.

July 13, 2002|JON HEALEY | TIMES STAFF WRITER

The New York Stock Exchange has warned Key3Media Group Inc., a leading producer of technology trade shows, that it may delist the company's shares unless the price climbs back above $1.

The Los Angeles-based company announced the warning Friday. The move was expected because Key3's shares closed below the crucial $1 threshold June 4 and have remained there since.

Under the rules of the exchange, companies have to maintain a certain level of financial performance to continue being listed for trading. One rule is that the stock not fall below $1 for an extended period.

Key3 owns several of the top brands in the technology trade-show business, including Comdex for information technology companies, Network+Interop for computer networks and Seybold for electronic publishers.

But its sales, earnings per share and stock price have fallen sharply since mid-2001, a decline that company Chairman Fredric D. Rosen has blamed on the slumping tech economy.

The stock, which sold for more than $10 a share a year ago, plunged in September and again in May, when Key3 announced disappointing results for the first quarter. Its shares closed Friday at 26 cents, down 1 cent in light trading.

Ned Goldstein, the company's general counsel, said the exchange notified Key3 of the potential delisting earlier this week. The company was given 10 days to present a plan for raising its stock price.

Key3 has six months to come back into compliance, but the exchange could take action sooner if the stock continues trading at its current level. To avoid being dropped, Goldstein said, Key3 must raise its average stock price to $1 or more for 30 straight days at the end of the six-month period.

Company executives offered no details on how they planned to respond. "We are reviewing our options," Goldstein said.

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